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DAX 30 Forecast: Index Threatens Range Break Out, Awaits GDP

DAX 30 Forecast: Index Threatens Range Break Out, Awaits GDP

Peter Hanks, Strategist

DAX 30 Price Outlook:

DAX 30 Forecast: Index Threatens Range Break Out, Awaits GDP

The DAX 30 has scampered higher in May thus far, looking to reclaim the ground it lost at the turn of the month. After fluctuating between two technical levels since early April, it seems as though the index has etched a range from resistance around 10,900 to support near 10,200. With that in mind, recent trips above the upper bound may suggest a willingness to continue higher, but trading above the area will have to be sustained before the DAX can solidify its gains and look higher still.

DAX 30 Price Chart: 1 – Hour Time Frame (April 2020 – May 2020)

dax 30 price chart

Using the index’s recent swing highs and lows, it can also be argued a falling wedge has been established and since price was climbing prior to the pattern, may suggest a break would serve a continuation higher. Whatever the technical prognosis may be, the index will likely await German and Euro Area GDP data before posting a significant technical break.

Due on May 15, the data has the ability to significantly influence sentiment – and therefore price – and could deliver the spark needed for the DAX 30 to break out of its various technical confines. Until the data is delivered, price action may be rather tepid as traders look to avoid exposure ahead of the impending event risk.

Therefore, the two-fold technical barriers overhead will look to keep a lid on further price gains for the time being. Conversely, potential support from the projected trendline drawn off of the recent swing lows could look to ward of losses. Either way, the upcoming data could posses the influence to make or break the DAX’s technical patterns and a committed follow-through may see the recent trading range broken. In the meantime, follow @PeterHanksFX on Twitter for updates and analysis.

--Written by Peter Hanks, Analyst for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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